Rants and musings about things political, philosophical, and religious.

Government, a Defective Product

I’m a frequent patron of Amazon.com. As I browse their wide selection in search of a product, one of the first criteria I apply to determine if a given product is worth what’s in my wallet is the customer reviews. At a quick glance, I can see the community’s rating of the product as well as the total number of reviews that calculated the overall rating. It’s extremely rare that I purchase anything with three or less stars (out of five total).

This is the market at work. Competition yields a better product, and increased selection offers a consumer such as myself the opportunity to rate the different products based on criteria I deem important, such as price, durability, brand recognition, and the reviews of individuals who have previously purchased the item in question.

With that context, consider the question: why should government be any different?

In a recent Rasmussen poll, just 6% of those surveyed thought that Congress was doing a “good” or “excellent” job. 68% viewed Congress’ job performance as “poor.” In Amazon.com-speak, this is like a product having a rating of a fraction of one star, with the vast majority of reviewers commenting to emphasize the product’s poor performance. No doubt these individuals would recommend that the potential purchaser of that item steer clear and find something better.

As one example, Crayola sells “washable colored bubbles,” and as the Amazon.com reviews from furious parents will indicate, it turns out that the bubbles aren’t that washable at all. Dozens of negative reviews report stained clothing, concrete, and children, and the product has one star out of five — the lowest possible rating. Hundreds, if not thousands, of similarly-catastrophic products are accompanied by reviews which immediately warn would-be buyers to reconsider.

Imagine ten parents wanting to buy these bubbles, reading through the near-universally negative reviews, and then nine of them deciding to go ahead with the purchase. Any bystander with a brain would be quite perplexed, wondering why such an awful product could command such strong sales figures.

We witness a similar pattern every election cycle. Despite abysmal, single-digit approval ratings, Congress will be little affected at the ballot box; if past elections are any indication, more than 90% of incumbents seeking re-election will defeat their opponents and retain their position. As the Proverb says, “As a dog returneth to his vomit, so a fool returneth to his folly.”

Americans know that their government is a poor product, and they’re openly disgusted with its quality and performance. But the nature of the state, with its monopoly on force and geography-based jurisdiction, prevents market forces from having any influence on improving the product. Competition in the marketplace yields products which are higher in quality and increasingly affordable. The state’s product of government decreases in quality and becomes more costly over time.

Innovative and radical ideas are needed in order to expose the underbelly of the state to competitive attacks from individuals and institutions which can perform traditional government functions better, faster, and cheaper. Any wise manufacturer seeing their product ripped to shreds by reviewers will halt production, invest in research and development, publicly commit to quickly fix the problems, and rapidly respond to the market’s collective input to create a product better suited to its liking. We, the people, must likewise put the brakes on the government while alternative solutions are proposed, considered, and finally implemented.

With a 6% approval rating and a 90% election rate, it’s clear that something is broken. The defective product that is our government might at this point be simply accompanied by a single, one-star review which reads: “buyer beware.”

A fool returning to his folly really works for this topic. The people return to the major “Jester” (the fool) of the “King’s” (the government) court (congress) to get their political opinions. Yup, in this world it’s the Fool who sits on the throne callling the shots by persuading the foolish people one way or the other. And who is the Fool, the Jester? TV. And that’s who call the shots, by flawlessly manipulating public opinion anyway they want! However, now we find it was a dissapointing year at the “box office”, and one cable company lost 800,000 customers; are people beginning to see through the sham and doing the one thing that can save the day? Yup, Turn Off The TV!

Yeah, it’s interesting in a paradoxical way. Local representatives are often able to actually take advantage of Americans’ low regard of Congress, by pitching themselves as antagonistic to and better than the system. They fulfill their careers in Washington, then return home and pitch themselves as “outsiders” and “mavericks” in Congress, rather than bureaucratic slaves of the rituals of decorum, consensus-building and assignment that they really are.

A “bad” Congress, by and large, actually entrenches each individual representative in their positions, as people generally like their representatives but dislike “Congress” as a whole.

Clumpy,
Actually I never really liked who was elected in my area. I did however like members of congress which expressed what I believed in, even if it didn’t directly benefit me. I also don’t see anything wrong with consensus, dialog, and even compromise.

I’m giving a positive to all who think we should spend more on the program or think we are giving the right amount and a negative to those who think we should spend less or don’t know. And rounding off to the nearest half star.

It has long been a favorite pasttime of people to rail against “Congress” or “Government” or “Big Business” or some other monolithic entity. Yet when one distills it down to something more particular, support always goes ways up.

I can’t count the number of times that I have had conversations with people wanting to see us “cut the size of government”. My response is always the same…what would you cut?

Invariably, the answers I get would be either a.) politically suicidal (Social Security, Medicare, Defense) or b.) have a negligible effect on the federal budget (NPR, EPA, Dept. of Education, etc.)

The entire premise here is that competition yields a better product. Very often that is true…but often it is not.

What laissez-faire idealists never seem to recognize is that a large number of markets utterly fail to meet these criteria for competition.

To use but one example…our local newspaper annually publishes a “BEST OF…” list. The results are based on surveys taken. One of the categories was “Best Physician”. A local doctor that won that award several times had excellent bedside manner and was loved by most of his patients. However, among medical professionals (like myself), he was widely viewed as being borderline incompetent. The average patient has little, if any, knowledge of medicine – so it is entirely possible for a physician to be a quack, but at the same time be very personable and compassionate. Such a doctor is likely to score very well in surveys of people that know nothing about how to evaluate a doctor beyond the fact that he is generally a nice guy.

Well, along those same lines, there are a number of reasons why your analogy between consumer goods and government is a poor one.

Regarding your Econ 101 comment, while it is true that a large number of markets fail to meet the criteria for “perfect competition”, when government monopolizes any industry or product that would otherwise be provided by the market, it completely obliterates all of the criteria and produces a much inferior product, way too much of some things, way to few of others, at a much higher cost than the market would have. The result is always a lower standard of living for everyone, more suffering, more death, less happiness, peace and prosperity.

I know you’re not going to agree with me, but your comment about the markets not meeting the criteria for “perfect competition” is irrelevant.

Brint, it sounds like you disagree with TRON and Clifton, but you started out by saying you were “echoing” them.

when government monopolizes any industry or product that would otherwise be provided by the market, it completely obliterates all of the criteria and produces a much inferior product, way too much of some things, way to few of others, at a much higher cost than the market would have.

Generally speaking, I would agree with this statement. The question I have is this…is it ALWAYS true? or maybe it’s true for most things, but not all.

While it is true that almost no market will perfectly adhere to the strictest definition of perfect competition, my point was that some markets fail SO drastically in meeting this definition that trying to introduce competiton into those markets is like trying to fit the proverbial square peg into the round hole.

I maintain that there are a few services that government will provide more efficiently than the free market.

To provide one very notable example…you doubtless recall California’s disastrous experiment with deregulation of the power industry. It was passed off using this same justification of “introducing competition” which was supposedly going to lead to a more efficient market with lower rates for everybody.

What actually happened? A very small number of major corporations (like Enron) came in and immediately began manipulating the market, creating artificial shortages and causing rates to skyrocket. (BTW, this is not some lefty conspiracy theory. There is rock-solid proof that this is exactly what happened.)

Anyhow, I get very suspicious when I hear someone talk about how the relying on “magic of the marketplace” will always provide the best possible outcomes. Maybe it will, but maybe it won’t. Too often, getting government out of something is nothing more than a robber baron’s fondest dream come true – and in many instances they will lobby hard and spend large sums in order to realize that dream.

However, to many folks, the concept that the private sector will always beat the public sector has become so dogmatic that they can not countenance the idea that this might not hold true anything less than 100% of the time – because once they admit that, they have just opened the door to government intervention.

I can appreciate your example of power generation in California. While it is true that occasionally “deregulation” has provided disasterous results, there are two isses to look at: 1. Was “deregulation” a move to free market principles or simply a move to “monopoly Capitalism”? 2. Are there multiple other market distortions involved that make a move toward a true free market impossible?

I believe the California experiment was a move to monopoly capitalism. This has been described by free market advocates (such as Hayek) and by socialist advocates (such as Engalls) as one of the final stages of capitalsm before socialism takes over. When we simply hand control of production over to huge companies, but keep the government hand controlling, regulating, and making major decisions (such as construction of power lines, or which out-of-state companies can sell power in-state, etc.), companies such as Enron (a study into Enron is really enlightening) tend to lobby and use this control to eliminate competition. Hayek argued that Government control is necessary to support monopoly capitalism in the long run.

Finally, I think we are shooting at the wrong target if we are simply looking for the Utopian goal of the lowest price at all times. In the short run, the government will always provide this with subsidies. In the long run, the market will provide the correct price for what we buy. I believe patience and some amount of willingness to accept less than Utopian results are necessary to protect our freedoms. Where we have shot past free markets to monopoly and government control, you are absolutely correct to observe that it will be difficult to move back to free market.

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About the Author

Connor Boyack is president of Libertas Institute, a public policy think tank in Utah. He is the author of several books along with hundreds of columns and articles championing individual liberty. Connor's work has been publicly praised by national figures such as Ron Paul, Judge Andrew Napolitano, Tom Woods, and many others.

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